BANK REGULATION AND SUPERVISION
F. Consumer Education and Protection
Article 4 Law Number 21 Year 2011 concerning OJK stated that one of OJK’s duties is to provide protection to the consumers and/or communities.
OJK policy to enhance financial literacy is expected to increase financial inclusion followed by good consumer protection. Through financial education, the public and consumers can better understand the basic features, the rights and obligations before and when utilizing financial products. Financial education that improves the financial literacy can further encourage the society to utilize the financial products and services that meet their needs. Further, financial consumers and public who have good understanding concerning financial products and services will be able to reduce consumers’
potential losses due to incomprehension, obscurity, lack of information or misinformation provided by LJK, so as to reduce complaints related to products and services provided. It also must be supported by LJK that apply consumer protection principles, i.e. (1) in providing sufficient information transparently to build public financial literacy; (2) treating consumer fairly; (3) reliable in providing financial services; (4) maintaining the confidentiality of consumer data; and (5) able to handle complaints and to settle consumer disputes in simple, quick and cost affordable manner.
OJK has two approaches in performing its function in the sectors of education and protection of SJK
1. Preventive actions
Preventive actions are carried out in the form of governance and implementation in the field of education and protection. Education which is preventive in nature is required as an initial step to enhance financial literacy of public, so that they will have good understanding regarding financial products and services. Such financial education is implemented by providing understanding to consumers and/or public on basic features, benefits and risks of financial products and services, as well as the rights and obligations of financial consumers.
Preventive activities shall be conducted through various media and ways, namely through:
a. Provision of financial education and information whether directly (face to face), through public service ads, and through online media (sikapiuangmu.ojk.go.id, and social media);
b. Public and/or consumer complaints services through OJK Consumer Services;
c. Market intelligence to prevent potensial losses experienced by consumers;
d. Self Assessment submitted by Financial Services Businesses (PUJK- Pelaku Usaha Jasa Keuangan);
e. Thematic Surveillance; and
f. Termination of activities actions or other actions.
In these preventive actions, other than conducts education and conveys information, OJK must also ensure that the products and services provided by LJK meet the consumer protection principle.
2. Repressive actions
Repressive actions are conducted in the form of settlements of complaints, facilitations of dispute
a financial market that functions well is a precondition in maintaining financial stability, growth, efficiency and innovation in a long term.
Repressive actions shall be conducted by way:
a. Facilitation of complaints settlements; and b. Legal defense to consumers (by instructing PUJK
to settle complaints of consumers).
3. OJK Integrated Consumer Services
The development of Integrated Consumer Service is one of the implementations of Law mandate of OJK, in its efforts to provide education and protection to consumers and the communities against infringement of Law and regulations in financial sector under OJK’s authority.
There are several ways to access this service, as follows:
Telephone : (local code area) 1500-655 E-mail : konsumen@ojk.go.id Facsimile : (021) 386-6032
Website : http://sikapiuangmu.ojk.go.id OJK Consumer Service is free of charge. There are 3 types of Consumer Service. First, OJK Consumer Figure 3.4 Concept of Consumer Education and Protection
SELF ASSESMENT THEMATIC SURVEILLANCE INFORMATION AND
EDUCATION GRIEVANCE SERVICE MARKET INTELLIGENCE
TERMINATION OF ACTIVITIES OR OTHER
ACTIONS
COMPLAINT SETTLEMENT FACILITY
ALTERNATIVE DISPUTE RESOLUTION
OR LEGAL REPRESENTATION REPRESSIVE
PREVENTIVE
CONCEPT OF CONSUMER EDUCATION AND
PROTECTION
third, a place to submit their complaints related to product and/or service made and offered by financial service institution under OJK’s authority.
In regards to complaints, there are several documentations required:
a. Evidence of complaints to related LJK and/or the respond;
b. Complete identity
c. Description of complaint; and d. Supporting documents (if any)
Integrated Financial Consumer Service was implemented using the following systems:
a. Can be tracked
Using a system that can be tracked, consumers can follow the development of complaint resolution process that they have conveyed to OJK.
b. Traceable
Using traceable system, LJK can follow the resolution process of the complaint or dispute that cannot be settled between LJK and its consumers, which resolution/settlement is petitioned by the consumer to OJK.
4. Alternative Dispute Resolution Agency (LAPS) LAPS (Lembaga Alternatif Penyelesaian Sengketa)
is an independent institution that provides out- of-court dispute settlement services. Dispute Resolutions through LAPS are conducted if the resolution of a dispute between consumers and LJK/Internal Dispute Resolution (IDR) cannot reach an agreement. LAPS provides services of dispute resolutions that are easy to access, quick, inexpensive, and conducted by HR who is
5. Be cautious of any interesting offer or advertisement that promises higher rate than normal, and report the related LJK if any problem arises in relation to the product and service used by consumer.
dispute to reach an agreement.
b. Adjudication
A way to resolve disputes through a third party (adjudicator) to give a ruling on disputes arising between the referred parties. Adjudication ruling is binding on the parties, in the event the concerned consumer accepts it. In the event the consumer rejects, the consumer can find other resolution efforts.
c. Arbitration
A way to resolve a civil dispute out of court based on arbitration agreement made in writing by parties having the dispute. Arbitration rulings are final and binding the parties.
Tips for Consumer Protection
1. To investigate before hand, the Financial Service Agency (LJK) that offered a product or service.
2. To examine if the offered product or service have obtained a permit from or registered in OJK.
3. To carefully read all information or agreement related to product or service offered by LJK and demand explanation if necessary, to understand clearly before buying or signing a contract/agreement.
4. LJK should provide a copy of contract/agreement to consumer
Figure 3.5 : Method of Consumer Protection Monitoring and Analysis
Monitoring and analyzing process for Consumer Protection in Financial Service Sector through filling out a Work Form by Financial Service Business Players as stated in the Guidelines for Monitoring and Analyzing Consumer
The process of Monitoring and Analyzing Consumer Protection in Financial Service Sector based on theme of products and/or services of the Financial Service Business Players who have the potency to hurt consumers.
Method of Consumer
Protection Monitoring and Analysis
5. Be cautious of any interesting offer or advertisement that promises higher rate than normal, and report the related LJK if any problem arises in relation to the product and service used by consumer.
Tips for a Safe Investment 1. Know the future financial needs.
2. People should understand any financial product offered to them.
3. Understand the risk of the financial product offered.
4. Avoid any investment offer with abnormal rate of return, because aside from high risk, it is not guaranteed by the government.
5. If in doubt, please do not hesitate to ask.
Characteristics of Investment to be Cautious About 1. Offering high rate of return
2. Free risk investment guarantee
3. Providing huge bonus and cash back for consumer who can get another consumer
4. Abuse testimony from the head of community to give an endorsement effect and trust
5. Promising return of invested assets and guaranteeing the security of invested assets (easy, flexible and safe)
6. Buy back guarantee without write-downs
7. Always remember that Trading Business License is not a license for funding and managing investment.